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Have you ever thought about buying property in Bali and found it overwhelming?
You’re not alone.
The idea of owning a retirement spot or generating passive income in Bali is attractive. However, learning how to purchase property abroad can be intimidating.
But don’t worry; we’re here to help.
Through this article, we want to simplify the complexities of buying property in Bali.
We aim to arm you with the knowledge to confidently step forward, knowing exactly what to do and avoid. Let’s get started!

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With over 12+ years in the market, here’s what we can do for you:
- Find the best location to invest in Bali.
- Reliable guidance on Bali’s property market and laws.
- Personalized strategy to maximize returns and meet your financial goals.
DOs:
#1: Owning Property in Bali as an Expat
If you’re thinking about buying property in Bali, the first step is understanding the rules about who can own property and how.
In Bali, there are two main types of ownership: Freehold (Hak Milik) and Leasehold (Hak Sewa).
1. Freehold
If you’re not Indonesian but wish to own property in Bali, you must know an essential fact. Only Indonesian citizens can fully own property, known as freehold ownership or Hak Milik.
But there’s a smart way expats can get around this. It’s by setting up a company called a PT PMA.
What is a PT PMA?
A PT PMA is a company in Indonesia that foreigners can own.
The Indonesian government lets these companies do various business activities, including owning property, under certain rules.
2. Leasehold
Option number 2 is leasing the property.
Leasehold ownership means you lease or rent the land or property from the owner for a long time—often 25 to 30 years and sometimes up to 100 years.
During this time, you have the right to use the property as if it were yours.
This can include living in it, renting it out to others, or making improvements or changes to the property.
#2: Conduct Thorough Due Diligence
When buying property in Bali, it’s super important to look into every detail before you decide.
This helps you avoid any surprises later on. Here’s what you need to do:
1. Check Who Owns the Property:
You want to be sure the person selling the property owns it and can sell it to you. This check stops you from running into legal problems later. The way to do it is to look at the property papers and make sure the seller’s name is the same as the owner’s name listed there. Also, check if there are any debts or claims on the property.
2. Ensure the property has all necessary permits:
When purchasing a property in Bali, verifying it has all the required permits is crucial. Every property needs government permission to be built on, lived in, or used for business. If you don’t have these permits, you might have to pay fines or even stop using the property as you want.
#3: Factor in Upkeep Costs
Owning a place means keeping it in good shape.
For example, if you have a pool, you’ll need to clean it regularly. You’ll also want to keep your garden looking fresh and inviting. And sometimes, things break and need fixing—and it costs money.
So, when figuring out how much you might earn from your property, don’t forget to include these upkeep costs.
Knowing all your expenses is better so you can plan better and not be surprised later.
Also read: The Cost of Buying Real Estate in Bali.
#4: Have a Clear Exit Strategy
Think of an exit strategy like planning a trip.
Before you start your journey, you know where you want to end up and how you will get there.
The same goes for real estate investing in Bali. Your exit strategy is your plan for what you’ll do with your property in the future.
It’s like having a map that shows you the best way to reach your destination, which is your goal for making a good return on your investment.
To learn more about how many leases remain for a better exit from your Bali investment, check out our complete guide here.
#5: Understand Pre and Post-Purchase Taxes
Understanding the tax implications before and after purchasing property in Bali is crucial for foreign investors.
Here’s the breakdown of what you need to know about pre and post-purchase taxes to make informed decisions and ensure your investment journey is smooth and compliant with local regulations.
Before You Buy:
- Due Diligence Fee: You pay this upfront for legal checks and property inspections. It’s not a tax, but it helps ensure the property is legally clear and in good shape.
- Notary Fees cover legal paperwork for the sale, including contracts. Costs vary, but they are usually around 1% of the property price.
After You Buy:
- Annual Land and Building Tax (PBB): This is a yearly tax based on property value. Generally low, around 0.1%–0.3% of the assessed property value.
- Income Tax on Rental Earnings: If you rent out, you pay income tax. Rates for non-residents are around 20% of rental income.
- Capital Gains Tax: When you sell, you pay tax on the profit. It’s usually 5% of the property sale price.
For exact numbers and exemptions, a local tax advisor is very helpful. They can ensure you follow the latest rules and help you with any deductions.
#6: Don’t Skip This Requirement
As a foreigner, you can buy property in Indonesia without having a visa. But there are some rules. You usually can’t own land outright (known as freehold), but you can get a leasehold. That’s like renting long-term, usually for 30 years, with a chance to extend.
Having a visa isn’t required, but it can be helpful. Some visas, like the Social Visa (KITAS) or new options like the Golden Visa, make it easier to stay longer in Indonesia and may come with extra perks.
It’s best to talk to a local expert so you know you’re following all the rules.
DON’Ts
#1: Fall for Rental Guarantees
Sometimes, locals might tell you that if you buy their property, they’ll ensure you get a certain amount of money from renting it out.
This sounds like an easy way to make money, but you must be careful. These deals often have hidden costs or conditions that can make them less good than they seem.
It’s better to look into the area’s rental market yourself and understand what kind of rent you can expect depending on each location in Bali.
You can start looking at sites like Airbnb or Facebook groups. Always check everything carefully before buying a property based on rental guarantees.
#2: Skip legal advice
Buying property in Bali has a lot of legal steps, especially for someone from another country.
Trying to figure this out yourself is not a good idea because you might miss something important. That’s why try getting help from a lawyer or a reputable property agent in Bali.
Hiring someone who knows about buying property in Indonesia is worth it.
They can help you through the process, ensure you follow the law, and protect your rights. This step is very important to keep your investment safe.
#3: Neglect Property Management
If you won’t be living in Bali or don’t want to spend all your time taking care of your property, you should consider hiring a company to do it for you.
This company will talk to your tenants, fix any problems with the property, and make sure everything is going well.
This way, you can make money from your property without dealing with all the day-to-day tasks.
#4: Ignore market trends
The real estate market can change significantly. What’s popular now might not be in a few years.
So, it’s important to examine what’s happening now, what has happened in the past, and what might happen in the future.
This can help you make better choices about where to invest your money. It can also help you plan for market changes so you don’t get caught off guard.
#5: Forget about exiting
When you buy property, you should also consider how you might sell it or leave it later.
This doesn’t just mean thinking about selling it for more than you paid. You should also consider what you’ll do if the market changes or if you want to give it to your kids.
Having a plan for this can help you avoid problems later on.
#6: Don’t cut corners
When buying property in Bali as a foreign investor, it is crucial not to cut corners during the property acquisition process.
This means avoiding shortcuts or bypassing legal procedures to secure a property. Related to this, it is important to be cautious when relying on nominees or trustees for property ownership.
Relying on an unreliable nominee can put your investment at risk and jeopardize the legal status of the property.
It is strongly recommended that you seek professional guidance throughout the process to safeguard your investment and ensure a secure transaction.
How To Get Started?
Do you know the feeling of chatting with a good friend over coffee, where every word brings you closer and you just get each other better?
After reading this guide, we want you to feel the same trust and comfort when you consider buying property in Bali.
Buying property in a new country can be tricky, but it can be much easier with a trustworthy local agent.
Whether you dream of a comfy beach house or a quiet mountain place, it’s all possible if you know what to do and what not to do when investing in Bali.
At Bali Villa Realty, we focus on making your investment experience easy and successful.
With an in-depth knowledge of the local market, we will help you find the right investment for your dreams and budget. Click here to get a free consultation for your dream investment in Bali.
Are you ready to have your first property in Bali?